Correlation Between FIT INVEST and Materials Petroleum
Can any of the company-specific risk be diversified away by investing in both FIT INVEST and Materials Petroleum at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining FIT INVEST and Materials Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIT INVEST JSC and Materials Petroleum JSC, you can compare the effects of market volatilities on FIT INVEST and Materials Petroleum and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in FIT INVEST with a short position of Materials Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIT INVEST and Materials Petroleum.
Diversification Opportunities for FIT INVEST and Materials Petroleum
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between FIT and Materials is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding FIT INVEST JSC and Materials Petroleum JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materials Petroleum JSC and FIT INVEST is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on FIT INVEST JSC are associated (or correlated) with Materials Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materials Petroleum JSC has no effect on the direction of FIT INVEST i.e., FIT INVEST and Materials Petroleum go up and down completely randomly.
Pair Corralation between FIT INVEST and Materials Petroleum
Assuming the 90 days trading horizon FIT INVEST JSC is expected to generate 0.29 times more return on investment than Materials Petroleum. However, FIT INVEST JSC is 3.42 times less risky than Materials Petroleum. It trades about 0.11 of its potential returns per unit of risk. Materials Petroleum JSC is currently generating about -0.21 per unit of risk. If you would invest 416,000 in FIT INVEST JSC on September 24, 2024 and sell it today you would earn a total of 6,000 from holding FIT INVEST JSC or generate 1.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 59.09% |
Values | Daily Returns |
FIT INVEST JSC vs. Materials Petroleum JSC
Performance |
Timeline |
FIT INVEST JSC |
Materials Petroleum JSC |
FIT INVEST and Materials Petroleum Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FIT INVEST and Materials Petroleum
The main advantage of trading using opposite FIT INVEST and Materials Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIT INVEST position performs unexpectedly, Materials Petroleum can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Materials Petroleum will offset losses from the drop in Materials Petroleum's long position.FIT INVEST vs. Damsan JSC | FIT INVEST vs. An Phat Plastic | FIT INVEST vs. Alphanam ME | FIT INVEST vs. APG Securities Joint |
Materials Petroleum vs. FIT INVEST JSC | Materials Petroleum vs. Damsan JSC | Materials Petroleum vs. An Phat Plastic | Materials Petroleum vs. Alphanam ME |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the CEOs Directory module to screen CEOs from public companies around the world.
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